One trader bet on longer-term support for BlackBerry Ltd

Option Brief: Shares of BlackBerry Ltd (NASDAQ:BBRY) tacked on another 6.1% yesterday, following Monday's news that the firm hired Ron Louks, a former Sony Ericsson executive, to lead its Devices and Emerging Solutions division. Meanwhile, the stock's options pits were busy on Tuesday, as approximately 197,000 contracts crossed the tape -- almost double the average daily norm.

One of the most popular options on the day was the September 7 put, which saw 20,100 contracts change hands -- mostly in one large block near the bid price of $0.85. Open interest at this strike soared overnight, pointing to the addition of new positions. What's more, data from the International Securities Exchange (ISE) confirms these puts were sold to open.

In other words, the trader is counting on BBRY to remain north of the $7 mark through September options expiration. This would render the contracts worthless, and allow him to pocket the initial premium collected from his put sales. However, if the stock were to fall below the strike price, the seller could find himself on the hook to purchase the shares at $7 apiece, no matter how far the security should sink between now and the close on Friday, Sept. 19 (when these options are due to expire).

BlackBerry Ltd (NASDAQ:BBRY) has been in recovery mode lately, advancing 56% since bottoming out at a 10-year low of $5.44 on Dec. 10. At last check, the equity was hovering around breakeven at $8.50.